income appreciation farmland investor report

HNRG Farmland Investor Report, March 2021 1

Farmland Investor Report U.S. Farmland Returns Remained Challenged in 2020

U.S. private farmland investments generated a total return of 3.1% in 2020 as

reported by the National Council of Real Estate Investment Fiduciaries (NCREIF),

dropping 173 basis points (bps) from the prior year. U.S. farmland performance in

2020 reached the lowest annual level of total returns since 2001 (when NCREIF

Farmland Index returns were 2.0%) and was 747 bps below the 10-year average of

10.6%. Declines in 2020 farmland returns occurred for both annual cropland (down

19 bps) and permanent crop properties (down 421 bps). Regional farmland

performance varied significantly. Return performance also varied considerably across

crop type: almonds, apples and wine grapes generated negative returns, while

pistachios and row crop investments had healthy returns.

Farmland Returns Reach Lowest Level since 2001 Chart 1. U.S. Farmland Returns (% per year)

Note: Hancock Natural Resource Group is a participating member in the NCREIF Farmland Property Index.

The Index requires participating managers to report all eligible properties to the Index. Usage of this data is

not an offer to buy or sell properties.

Source: NCREIF Farmland Property Index as of Q4 2020

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In 2020, U.S. private farmland investment returns, at 3.1%,

were the second lowest in the history of the NCREIF farmland

index. See Chart 1. U.S. Farmland Returns. Last year’s

declining total returns resulted from tumultuous domestic and

international market conditions associated with the COVID-19

pandemic. The 2020 economic downturn began in late Q1,

dealing direct impacts across food and agriculture sectors

challenging the entire business ecosystem of food retailers,

processors and farmers. On the one hand, food demand from

food-away-from-home outlets, such as restaurants and

entertainment venues, plummeted. Concurrently, row-crop

farmers contended with a significantly lower fuel demand from

reduced travel that brought down the demand for corn for

ethanol production. These pandemic-generated disruptions

were reflected in declines in farmland income returns, which

decreased by 112 bps from 2019, and negative capital

appreciation, the first negative appreciation since the low points

reached in 2001-2002.1

The USDA estimated that 2020 U.S. crop cash receipts moved

up 0.3% over 2019.2 The increases were primarily driven by

stronger government direct payments in 2020. The USDA

estimates that financial support from the federal government in

forms of direct payments and ad hoc support programs topped

$46 billion in 2020, marking a 106% increase over 2019.3 A

major factor in the expanded government support were the

sizable “supplemental and ad hoc disaster assistance”

programs meant to help farmers weather the pandemic-induced

hardship, on top of the last tranche of the Market Facilitation

Program payments that originated in 2018 to help farmers

tackle trade-related difficulties. In terms of actual sales of farm

products, cash receipts from crop sales were up 5.5% from

2019, while livestock and dairy products saw revenues dip 5.4%

from 2019.4

NCREIF Farmland Index Overview

The most recognized measure of farmland return performance

in the U.S. is the NCREIF Farmland Property Index. The Index

is a quarterly measure of investment performance of farmland

properties acquired in the private market for investment

purposes. All properties in the Farmland Index are held in a

fiduciary environment. At 2020 year-end, the NCREIF Farmland

Property Index included 1,184 properties valued at $12.3 billion,

up from 2019 when the Index included 1,152 properties valued

at $11.4 billion. The robust increase in the number and value of

properties reflects growing institutional investment in the asset

class and consolidation in farmland ownership. Annual cropland

properties comprise 76% of total properties in the Index and

60% of the total value of the Index.

Continued Increase in Number and Value of Properties Reflects Growth in Institutional Ownership Chart 2: NCREIF Farmland Properties and Market Value ($ billions)

Permanent Crops Represent 40% of the Total Farmland Index Chart 3. NCREIF Farmland Index Properties by Crop Type, ($ billions)

Pacific West, with a Concentration of High-Value Permanent Crops, Accounts for 41% of Index Value Chart 4: NCRIEF Farmland Index Property Value by Region, ($ billions)



Source: NCREIF Farmland Property Index as of Q4 2020 Note: Hancock Natural Resource Group is a participating member in the NCREIF Farmland Property Index. The Index requires participating managers to report all eligible properties to the Index. Usage of this data is not an offer to buy or sell properties.

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ropert

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Number of Properties (leftaxis)

Market Value (right axis)

Permanent - Almonds $1.0 Permanent -

Apples, $0.4

Permanent - Pistachios

$0.9

Permanent - Wine

Grapes, $2.0

Permanent - Citrus,

$0.3

Permanent - All Others,

$0.5

Annual -Commodity,

$4.2

Annual -Fresh

Produce, $0.9

Annual - All Others,

$2.2

1NCREIF Farmland Property Index, December 31 2020. 2USDA Economic Research Service, https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/highlights-from-the-farm-income-forecast, Feb 5 2021 3USDA Economic Research Service, https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/highlights-from-the-farm-income-forecast, Feb 5 2021 4USDA Economic Research Service, https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/farm-sector-income-forecast/, Feb 5 2021

Pacific West $5.0

Pacific Northwest

$0.9Corn Belt

$1.3

Delta States $2.4

Southeast $0.7

Mountain $1.0

Southern Plains $0.2

Lake States $0.5

Appalachian $0.0

Northern Plains $0.3

https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/highlights-from-the-farm-income-forecast


https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/farm-sector-income-forecast/


NCREIF provides detailed farmland returns by type of

operation and by region. Annual cropland properties need to be

planted each year, including crops such as oilseeds, cotton,

vegetables and certain fresh fruits, while permanent cropland

properties are dedicated to perennial trees, shrubs or vines

bearing crops such as almonds, apples, cranberries and wine

grapes. The largest permanent crop types in the index are wine

grapes, almonds and pistachios, combining for 77% of the

permanent cropland value as of 12/31/2020 (see Chart 3, Page

3, NCREIF Farmland Index Properties by Crop Type).

At 2020 year-end, the NCREIF Farmland Property Index

included 904 annual cropland properties valued at $7.4 billion,

and 280 permanent cropland properties valued at $4.9 billion.

In 2020, the largest NCREIF farmland region by market value

was the Pacific West (41% of the Index), followed by the Delta

States (19%), the Corn Belt (10%) and the Mountain (8%)

regions. The remaining regions combined accounted for 21% of

the Index value (see Chart 4, , NCREIF Farmland Index

Property Value by Region).

Performance Results by Region and Crop-type

The total return for U.S. annual cropland properties in 2020

was 4.2%, down 19 bps from 2019 (see Chart 5, Page 4, U.S.

Annual Cropland Returns). The slight decrease in annual

cropland performance in 2020 were slightly more moderate

than the 152-bp decline in annual cropland returns in 2019. In

2020, U.S. annual cropland’s operating income return was

3.4%, narrowly beating the income return in 2019. The negative

impacts from corn demand reduction due to lower ethanol

demand were partially offset by stronger demand for feed crops

in the U.S., from both exports and domestic markets. Total

returns were dragged down by another year of weaker capital

appreciation returns at 0.8% (down 27 bps).

U.S. permanent cropland generated a total return of 1.3% in

2020, delivering the second-weakest annual performance since

2001 and down 421 bps from 2019. (see Chart 6, Page 5, U.S.

Permanent Cropland Returns). Operating income returns for

permanent cropland were 3% (down 326 bps from 2019), while

capital appreciation returns were -0.2% (down 93 bps from

2019). Most (79% by value) permanent cropland properties in

the Index are directly operated, contributing to more volatility in

operating income compared to annual cropland, which are

mainly leased properties.

Almonds, accounting for 20% of the total permanent cropland

value in the NCREIF index, exerted a strong drag on

permanent crop returns in 2020. Almonds’ annual returns

turned negative in 2020, down 11% from 2019. The decline in

almond returns was due to record-breaking production and

dampened demand from export markets, resulting in lower

prices and weighing down valuations. Wine grape returns

continued to slide in 2020, with total returns down -490 bps

from 2019, reflecting negative income and appreciation returns.

Pistachios were a bright spot for permanent crops in a chaotic

2020, generating 15.3% in total returns, supported by a 577-bp

increase in operating income, as prices remained robust even

as crop yields rose.5

Regional farmland performance showed significant variations.

While all eight of the largest regions in the NCREIF index saw

positive income returns in 2020, three regions, Pacific West,

Mountain and Pacific Northwest, experienced negative

appreciation rates. (see Chart 7, Page 6, U.S. Regional

Cropland Returns, and Table 1, Page 6, U.S. Regional

Cropland Returns in the Eight Largest NCREIF Farmland Index

Regions) The Pacific West region, accounting for 41% of the

total index market value, had income returns slip 281 bps from

2019, while the appreciation rate edged downwards, generating

a total of 2.6% in 2020 (291 bps lower than 2019 total returns).

The region’s main crops are wine grapes and tree nuts, both

dragging on the region’s returns.

Compressed Appreciation Weighed Down Overall U.S. Annual Cropland Returns in 2020 Chart 5: U.S. Annual Cropland Returns (% per year)


U.S. Permanent Crop Returns Moved Lower in 2020 on Lower Income Returns and Weaker Appreciation Returns Chart 6: U.S. Permanent Cropland Returns (% per year)


Note: Hancock Natural Resource Group is a participating member in the NCREIF Farmland Property Index. The Index requires participating managers to report all eligible properties to the Index. Usage of this data is not an offer to buy or sell properties.

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5USDA Agricultural Marketing Service, Custom Average Pricing System, February 2021.


The Delta States and Corn Belt regions, accounting for

nearly 30% of the overall index value, produced positive

operating income and appreciation returns that were

higher than 2019, benefiting from improving trade

relationships and higher-than-expected crop demand.

The Mountain and Pacific West regions are other two

regions with negative appreciation returns. The three

smaller regions, the Southeast, Lake States and

Southern Plains, fared relatively better in the index, all

with operating income returns higher than 4% and

positive appreciation returns. However, due to their

smaller sizes, the positive returns in these three regions

were outweighed by underperformance in the Pacific

Northwest.

Sour

Looking Forward

The market outlook for 2021 begins with a more positive tone than 2020. On the positive side, macroeconomic conditions have

already begun to rebound both at home and abroad, with supply chain disruptions being worked out.6 Prospects for agricultural

products are positive, as domestic demands snap back and export demand remains strong.7 However, the U.S. farm sector faces

headwinds from both supply and demand factors. On the demand side, international trade remains key to the success of U.S. farm

sector, especially the trade relationship with China. On the supply side, U.S. farmers will continue to search for balance as some

crops continue to face challenges from ample inventories. On the balance, U.S. farm sector revenue is expected to improve in 2021,

as higher prices, additional acres and normalizing crop yields contribute to the USDA-projected increase in cash receipts reaching

$391 billion for the year, up 6% from 2020.8

Lower Operating Income and Negative Appreciation in the Pacific West Negative Impacted Total NCREIF Returns in 2020 Chart 7: U.S. Regional Cropland Returns (% per year)


Four of Eight Largest NCREIF Regions Experienced Declines in 2020 Total Returns

Table 1: U.S. Regional Cropland Returns in the Eight NCREIF Farmland Index Regions (% per year)

HNRG Research as of Q4 2020

Pacific West

Delta States

Corn Belt Mountain Pacific

Northwest Southeast

Lake States

Income 3.46% 3.11% 2.89% 3.83% 0.17% 4.60% 4.91%

bps +/- 2018 -281.1 16.8 10.0 -11.8 -136.6 -28.9 64.2

Appreciation -0.86% 0.98% 1.44% -0.65% -2.59% 0.65% 1.19%

bps +/- 2018 -7.9 26.4 46.3 -135.2 -346.7 -325.6 133.2

Total Return 2.57% 4.11% 4.36% 3.16% -2.42% 5.27% 6.13%

bps +/- 2018 -290.5 43.9 57.8 -150.8 -484.3 -368.3 201.8

6New York Times, February 1 2021, https://www.nytimes.com/2021/02/01/business/economy/cbo-economy-estimate.html 7USDA, The Outlook for U.S. Agriculture – 2021 Building on Innovation: A Pathway to Resilience, https://www.usda.gov/sites/default/files/documents/2021-meyer-speech.pdf 8USDA Economic Research Service, https://www.ers.usda.gov/topics/farm-economy/farm-sector-income-finances/highlights-from-the-farm-income-forecast, February 5 2021

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DeltaStates

Corn Belt Mountain PacificNorthwest

Southeast LakeStates

SouthernPlains

Appreciation Income



Global 2020 marketing year soybean production is

expected to increase by 7% from the previous

marketing year to 361 MMT. U.S. soybean production

is forecast to increase by 16% to 113 MMT driven by

a rebound in harvested acres and yield compared

with the previous year. Brazilian production is

forecast to increase 6% to 133 MMT in the 2020

marketing year. Brazil’s weakened currency has

made soybean production highly profitable.

Argentina’s soybean production is forecast to

decrease slightly to 48 MMT because of dry weather

conditions.

Global Soybean Production to Recover in 2020 Marketing Year Figure 2: Annual Soybean Production Estimates, Major Producers

(Million Metric Tons)

Global corn production is expected to reach a new

record in the 2020 marketing year, driven by gains in

the U.S. and Brazil. U.S. corn production is forecast

to increase by 4% to 360 MMT due to increases in

both harvested area and yield. Brazil’s 2020

marketing year production is forecast to increase by

7% to 109 MMT. China’s production is forecast to

remain level with last year at 261 MMT. Argentina’s

corn production is forecast to decline 7% to 47.5

MMT. Argentina’s agricultural production has shifted

towards soybeans, which are less expensive to grow

than corn, in response to an increase in corn export

taxes by Argentina’s president, Alberto Fernandez.

Global Corn Production to reach new record in 2020 Marketing Year Figure 1: Annual Corn Production Estimates, Major Producers


Farmland Market Indicators Data as of 12/31/2020

Source: USDA WASDE as of February 2021. 2019 is estimated and 2020 is projected.

Years are MY

Source: USDA WASDE as of February 2021. 2019 is estimated and 2020 is projected.

Years are MY

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Global corn exports rose in Q4 2020, driven by

stronger demand from China, as China rebuilds its

pig herd after the African swine fever and restocking

its domestic corn reserves. The weak USD helped

boost U.S. corn exports, which have increased by

10% since last quarter to 12.9 MMT and were up

25% compared to the same period last year. Brazil’s

four-quarter moving average exports declined 19%

compared to last year and were up 1% since last

quarter at 8.6 MMT, as record exports in the previous

year has depleted Brazil’s corn stocks. A major

tailwind for Brazil’s grain exports in the future, is the

paving of the BR-163, a highway that runs through

Mato Grosso and Para, and ends at the river

terminals of Miritituba, the site of several major grain

trading companies. Argentina four-quarter moving

average exports increased by 8% since last year and

were down 5% from last quarter to 9 MMT.

US corn exports continue to increase in Q4 2020 Figure 4: Four-Quarter Moving Average Corn Exports, Major Producers


The U.S. dollar (USD) weakened against major

competing currencies as investors continue to shift

away from the dollar-backed assets and looked for

riskier assets because of the success of the vaccine

trials. The USD weakened 5% against the Canadian

dollar and the Russian Ruble, by 7% against the

Australian Dollar, and by 8% against the Brazilian

Real. The USD rose by 9% against the Argentinian

peso. Argentina’s debt negotiations with the IMF have

not yet resulted in a deal.

Dollar Falls Substantially in Q4 2020 Figure 3: Quarterly Exchange Rates Between USD and Agricultural Currencies (Indexed to 1 at 2006: Q1)

Farmland Market Indicators (Continued) Data as of 12/31/2020

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Brazil Russia CanadaArgentina Australia Brazil

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2020Q4

Argentina Brazil US

Sources: FAS GATS, Comexstat and Argentina Ministry of Agroindustry as of December

2020

Source: Macrobond as of December 2020


In Q4 2020, U.S. corn, wheat and soybean prices all

rose on strong export demand. Soybeans prices rose

the most and at $10.14/bu were up 17% since last

year. Wheat prices rose by 16% from last year to

$5.22/bu. Wheat export restrictions in Russia have

provided additional lift on U.S. wheat prices. Corn

prices were up 1% since last year, at $3.79/bu.

Source: USDA NASS as of December 2020

US Soybean Production Hit record in Q4 2020 Figure 5: Four-Quarter Moving Average Soybean Exports, Major Producers (Million Metric Tons)

Row Crop Prices Surge on Strong Export Demand Figure 6: Row Crop Prices (USD per bushel)


Sources: FAS GATS, Comexstat and Argentina Ministry of Agroindustry as of December

2020

In Q4 2020, U.S. soybean exports surged as the

result of the weak currency and strong demand from

China. On a four-quarter moving average basis, at 16

MMT, US soybean exports were up 30% from last

quarter and 23% higher than last year. The four-

quarter moving average of Brazil soybean exports

was at 21 MMT, down 10% over last quarter and 13%

higher year-over-year, nearly depleting the country’s

soybean stocks. Argentina’s soybean exports at a

four-quarter moving average of 1.6 MMT were down

by 32% from last year, due to high inflation and

export taxes.

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2020 NCREIF Row Crop Returns Decline from 2019 Figure 8: NCREIF Row Crops Total Return (% per year)

For marketing-year 2020 almond and walnut prices are

forecast to decline because of abundant crops. The

Almond Industry Position Report forecasts a record 3-

billion-pound almond production in 2020, 20% higher

than the 2019 crop. On the other hand, strong exports

could partially offset large crop size. Exports through

December were 28% higher than the previous year’s

exports through December. The USDA estimates the

2020 walnut crop to increase 20% over the previous

year. Walnut exports have also been strong, with

exports through December 2020 up 9% from the

previous year. The pistachio crop has reached a

milestone of producing a billion-pound crop. Despite

this record, pistachio prices are forecast to increase.

Pistachio production is more concentrated and as a

result more likely to set prices in the market than

almond or walnut producers. Pistachio exports for

September were up 11% from the prior year.

Q4 2020 NCREIF row crop returns were 1.60%. Year-

to-date (YTD) returns are at 4.20%, the lowest YTD Q4

returns in NCREIF’s history. Low commodity prices,

the trade war, labor shortages and the COVID-19

pandemic created a challenging environment for

farmers for most of the year. However, in Q4, there

was positive momentum in agriculture, with strong

export demand and rising prices. USDA Farm Income

and Wealth Statistics projects 2021 crop cash receipts

to rise by 5.8%, the largest increase in cash receipts

since 2012.


Sources: USDA data as of September 2020 2020 and HNRG Research as of November 2020. Years are MY.

Pistachio, Almond and Walnut Prices Forecast to Decline in 2020 Despite Strong Exports Figure 7: Annual U.S. Average Grower Tree Nut Prices (USD per lb.)

Source: NCREIF September 2020 Note: Hancock Natural Resource Group is a participating member in the NCREIF Farmland Property Index. The Index requires participating managers to report all eligible properties to the Index. Usage of this data is not an offer to buy or sell properties.

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Notes Farmland Market Indicators

Figure 1. Corn production is charted on a calendar year basis and updated on a marketing year basis. The corn marketing year is

from September to August for the U.S., from May to April for South Africa, and from October to September for China. The corn

marketing year is from March to February in Argentina and Brazil. Corn Production data and forecasts are updated on a monthly basis

by the USDA World Agricultural Supply and Demand Estimates Report (WASDE).

Figure 2. Soybean production is charted on a calendar year basis and updated on a marketing year basis. The soybean marketing

year is from September to August for the U.S., from February to January for Brazil and for April to March for Argentina. Soybean

Production data and forecasts are updated on a monthly basis by the USDA World Agricultural Supply and Demand Estimates Report

(WASDE).

Figure 3. Exchanges rates are updated on a daily basis by Macrobond Financial AB.

Figure 4. Argentina’s agricultural exports are published on a monthly basis by the Argentinian Ministry of Agroindustry. Brazil export

data is published on a monthly basis by Comexstat. U.S. exports are published on a monthly basis by the U.S. Census Bureau. Export

data is reported on a 4 quarter moving average to adjust for seasonality.

Figure 5. Argentina’s agricultural exports are published on a monthly basis by the Argentinian Ministry of Agroindustry. Brazil export

data is published on a monthly basis by Comexstat. U.S. exports are published on a monthly basis by the U.S. Census Bureau. Export

data is reported on a 4 quarter moving average to adjust for seasonality.

Figure 6. Row Crop Prices are published on a monthly basis by the USDA National Agricultural Statistics Service (USDA NASS).

Figure 7. Permanent Crop Prices are published on a annual basis by the USDA National Agricultural Statistics Service (USDA

NASS). Almond, Pistachio and Walnut price estimates for the current year are calculated by using the % annual changes for the crop

year in the prices from HNRG sources. Export volume data per USDA Economic Research Service.

Figure 8. USDA Cash Crop Receipts data is published three times a year in February, August and November by the USDA’s

Department of Agriculture Economic Research Service. The U.S. level calendar-year forecast is first published in February. The

August release converts the previous year’s forecast to estimates and the November release updates the current year forecast.

NCREIF Farmland Total Return data is published on a quarterly basis. NCREIF quarterly total row crops returns are aggregated to

form the total return for the year. The total return as seen on the bar chart may not equal the annual total return as reported by

NCREIF, because the NCREIF annual return is calculated by multiplying instead of adding quarterly returns together.

Keith Balter

Managing Director,

Economic Research

[email protected]

Mary Ellen Aronow

Director,

Forest Economics

[email protected]

Daniel V. Serna

Associate Director,

Senior Agricultural Economist

[email protected]

Elizabeth Shestakova

Economic Research Analyst

[email protected]

Weiyi Zhang, Ph.D

Senior Natural Resource

Economist

[email protected]

HNRG Research Team

About Hancock Natural Resource Group

Hancock Natural Resource Group, Inc. is a registered investment adviser and part of Manulife Investment Management’s Private

Markets platform. We specialize in global farmland and timberland portfolio development and management on behalf of our investors

worldwide. Our timber division manages approximately 6 million acres of timberland across the United States and in Canada, New

Zealand, Australia, and Chile. Our agricultural investment group oversees approximately 300,000 acres of prime farmland in major

agricultural regions of the United States and in Canada and Australia.

About Manulife Investment Management

Manulife Investment Management is the global wealth and asset management segment of Manulife Financial Corporation. We draw

on more than 150 years of financial stewardship to partner with clients across our institutional, retail, and retirement businesses

globally. Our specialist approach to money management includes the highly differentiated strategies of our fixed-income, specialized

equity, multi-asset solutions, and private markets teams—along with access to specialized, unaffiliated asset managers from around

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Important Information

A widespread health crisis such as a global pandemic could cause substantial market

volatility, exchange trading suspensions and closures, and affect portfolio performance.

For example, the novel coronavirus disease (COVID-19) has resulted in significant

disruptions to global business activity. The impact of a health crisis and other epidemics

and pandemics that may arise in the future, could affect the global economy in ways that

cannot necessarily be foreseen at the present time. A health crisis may exacerbate other

pre-existing political, social and economic risks. Any such impact could adversely affect

the portfolio’s performance, resulting in losses to your investment

Investing involves risks, including the potential loss of principal. Financial markets are

volatile and can fluctuate significantly in response to company, industry, political,

regulatory, market, or economic developments. These risks are magnified for investments

made in emerging markets. Currency risk is the risk that fluctuations in exchange rates

may adversely affect the value of a portfolio’s investments.

The information provided does not take into account the suitability, investment objectives,

financial situation, or particular needs of any specific person. You should consider the

suitability of any type of investment for your circumstances and, if necessary, seek

professional advice.

This material, intended for the exclusive use by the recipients who are allowable to

receive this document under the applicable laws and regulations of the relevant

jurisdictions, was produced by, and the opinions expressed are those of, Manulife

Investment Management as of the date of this publication, and are subject to change

based on market and other conditions. The information and/or analysis contained in this

material have been compiled or arrived at from sources believed to be reliable, but

Manulife Investment Management does not make any representation as to their accuracy,

correctness, usefulness, or completeness and does not accept liability for any loss arising

from the use of the information and/or analysis contained. The information in this material

may contain projections or other forward-looking statements regarding future events,

targets, management discipline, or other expectations, and is only as current as of the

date indicated. The information in this document, including statements concerning

financial market trends, are based on current market conditions, which will fluctuate and

may be superseded by subsequent market events or for other reasons. Manulife

Investment Management disclaims any responsibility to update such information.

Neither Manulife Investment Management or its affiliates, nor any of their directors,

officers or employees shall assume any liability or responsibility for any direct or indirect

loss or damage or any other consequence of any person acting or not acting in reliance

on the information contained herein. All overviews and commentary are intended to be

general in nature and for current interest. While helpful, these overviews are no substitute

for professional tax, investment or legal advice.

Clients should seek professional advice for their particular situation. Neither Manulife,

Manulife Investment Management, nor any of their affiliates or representatives is providing

tax, investment or legal advice. Past performance does not guarantee future results. This

material was prepared solely for informational purposes, does not constitute a

recommendation, professional advice, an offer or an invitation by or on behalf of Manulife

Investment Management to any person to buy or sell any security or adopt any investment

strategy, and is no indication of trading intent in any fund or account managed by Manulife

Investment Management. No investment strategy or risk management technique can

guarantee returns or eliminate risk in any market environment. Diversification or asset

allocation does not guarantee a profit nor protect against loss in any market. Unless

otherwise specified, all data is sourced from Manulife Investment Management.

These materials have not been reviewed by, are not registered with any securities or other

regulatory authority, and may, where appropriate, be distributed by the following Manulife

entities in their respective jurisdictions. Additional information about Manulife Investment

Management may be found at www.manulifeim.com/institutional Australia: Hancock Natural Resource Group Australasia Pty Limited., Manulife

Investment Management (Hong Kong) Limited. Brazil: Hancock Asset Management Brasil

Ltda. Canada: Manulife Investment Management Limited, Manulife Investment

Management Distributors Inc., Manulife Investment Management (North America) Limited,

Manulife Investment Management Private Markets (Canada) Corp. China: Manulife

Overseas Investment Fund Management (Shanghai) Limited Company. European

Economic Area and United Kingdom: Manulife Investment Management (Europe) Ltd.

which is authorised and regulated by the Financial Conduct Authority, Manulife Investment

Management (Ireland) Ltd. which is authorised and regulated by the Central Bank of

Ireland Hong Kong: Manulife Investment Management (Hong Kong) Limited. Indonesia:

PT Manulife Aset Manajemen Indonesia. Japan: Manulife Investment Management

(Japan) Limited. Malaysia: Manulife Investment Management (M) Berhad (formerly

known as Manulife Asset Management Services Berhad) 200801033087 (834424-U)

Philippines: Manulife Asset Management and Trust Corporation. Singapore: Manulife

Investment Management (Singapore) Pte. Ltd. (Company Registration No. 200709952G)

South Korea: Manulife Investment Management (Hong Kong) Limited. Switzerland:

Manulife IM (Switzerland) LLC. Taiwan: Manulife Investment Management (Taiwan) Co.

Ltd. United States: John Hancock Investment Management LLC, Manulife Investment

Management (US) LLC, Manulife Investment Management Private Markets (US) LLC and

Hancock Natural Resource Group, Inc. Vietnam: Manulife Investment Fund Management

(Vietnam) Company Limited.

Manulife Investment Management, the Stylized M Design, and Manulife Investment

Management & Stylized M Design are trademarks of The Manufacturers Life Insurance

Company and are used by it, and by its affiliates under license.

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